Votes

Memo

BILL NUMBER:S3057

TITLE OF BILL: An act to amend the public authorities law, in relation to creating the solar feed-in tariff pilot program

PURPOSE OR GENERAL IDEA OF BILL: To establish the solar feed-in tariff pilot program in the state of New York to be instituted by the Long Island Power Authority within the service area of such authority.

SUMMARY OF SPECIFIC PROVISIONS: Section 1. Legislative Intent

Section 2. Establishes the terms of the solar feed-in tariff pilot program

Section 3. Severability clause

Section 4. Effective Date

JUSTIFICATION: This solar feed-in tariff pilot program would require-the Long Island Power Authority to initially pay $0.22 per kilowatt hour for solar energy Produced by solar energy generation facilities located within its service area. Feed-in tariff programs such as this have been successfully implemented Germany and Spain, and in March of 2009, Gainesville, Florida became the first United States city to introduce a similar program for solar power.

Installation of photovoltaic devices that generate electricity by the collection and distribution of solar energy can be expensive. A solar feed-in tariff would provide an incentive for homeowners and businesses to invest in an opportunity which will ultimately result in sustainable green power sources that will deliver electricity to public utilities.

Not only will this program encourage the rapid and sustainable development of electricity from renewable sources, it will create green jobs in New York State. The German solar energy industry created over 50,000 jobs in less than five years, with the entire renewable energy industry creating as many as 200,000. More than 25,000 solar energy workers are employed in Spain. In the short time this program has been tested in Gainesville, a surge of capital investment in community solar systems has been experienced, and local contractors have been hiring to meet demand. A solar feed-in tariff program would provide a simple and transparent means for solar investments to earn reasonable and reliable returns, allowing capital to flow into clean and renewable energy systems.

Text

IN SENATE -- Introduced by Sen. LAVALLE -- read twice and ordered print-
ed, and when printed to be committed to the Committee on Energy and
Telecommunications
IN ASSEMBLY -- Introduced by M. of A. THIELE, GABRYSZAK -- read once and
referred to the Committee on Corporations, Authorities and Commissions
AN ACT to amend the public authorities law, in relation to creating the
solar feed-in tariff pilot program
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Legislative intent. The legislature finds and declares all
of the following:
(a) It is the policy of the state of New York to encourage the rapid
and sustainable development of electricity from renewable sources,
particularly from smaller, widely distributed solar photovoltaic instal-
lations, by the adoption of a solar feed-in tariff pilot program created
pursuant to this act. Such pilot program will be instituted by the Long
Island Power Authority within the service area of the authority.
(b) This act will create green jobs for the state. The German solar
energy industry created over 50,000 jobs in less than five years, with
the entire renewable energy industry creating as many as 200,000 jobs.
Spain boasts 25,000 solar energy workers. Gainesville, Florida, where a
solar feed-in tariff program is currently being tested, is experiencing
a surge of capital investment in community solar systems and local
contractors are hiring.
(c) The pilot program created pursuant to this act will moderate the
near-term impact on ratepayers, while reducing volatility and long-term
rates relative to other sources of power.
(d) The pilot program created pursuant to this act will encourage
energy conservation by requiring a separate new meter to measure the

EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06152-01-3

S. 3057 2 A. 3885

amount of solar electricity produced on site, while retaining the meter
that measures the total amount of electricity used on site.
(e) Distributed generation will enhance reliability while maintaining
utility profitability.
(f) Local power generation from renewable energy resources is a clear
pathway to energy independence and security for our future.
(g) Distributed solar installations bring the opportunity for renewa-
ble power generation to the local level, avoiding the environmental
costs of large-scale, carbon-based, centralized power generation, and
reducing a wide range of air pollutants, particularly greenhouse gases.
(h) This act presents a market mechanism to spur the solar industry
within our communities. It provides a simple and transparent means for
solar investments to earn reasonable and reliable returns, allowing
capital to flow into clean and renewable energy systems in New York
communities. While initially more expensive, these investments will, in
the near future, result in sustainable green power sources that will
deliver electricity to public utilities at lower energy costs than
conventional generation.
S 2. Sections 1020-ii, 1020-jj and 1020-kk of the public authorities
law, as renumbered by chapter 388 of the laws of 2011, are renumbered
sections 1020-jj, 1020-kk and 1020-ll and a new section 1020-ii is added
to read as follows:
S 1020-II. SOLAR FEED-IN TARIFF PILOT PROGRAM. 1. FOR THE PURPOSES OF
THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
(A) "COMMISSIONED" MEANS THE FIRST TIME A SOLAR ENERGY GENERATION
FACILITY IS PUT INTO OPERATION FOLLOWING ESTABLISHMENT OF OPERATIONAL
READINESS. COMMISSIONING ALSO INCLUDES THE MODERNIZATION OF AN EXISTING
SOLAR ENERGY GENERATION FACILITY, IF MODERNIZATION COSTS ARE AT LEAST
FIFTY PERCENT OF THE TOTAL ESTIMATED COST TO BUILD A COMPLETELY NEW
ELECTRICAL GENERATION FACILITY AT THAT SITE, INCLUDING ALL BUILDING
STRUCTURES AND INSTALLATIONS REQUIRED FOR ITS OPERATION.
(B) "PROGRAM" MEANS THE SOLAR FEED-IN TARIFF PILOT PROGRAM CREATED
PURSUANT TO THIS SECTION.
(C) "SOLAR ENERGY GENERATION FACILITY" MEANS A FACILITY OR DEVICE THAT
HAS THE PRIMARY PURPOSE OF COLLECTION AND DISTRIBUTION OF SOLAR ENERGY
FOR THE GENERATION OF ELECTRICITY, THAT HAS THE CAPACITY TO PRODUCE AT
LEAST ONE KILOWATT AND NOT MORE THAN ONE MEGAWATT OF ALTERNATING CURRENT
RATED PEAK ELECTRICITY.
(D) "TAXABLE ENTITY" MEANS AN OWNER OR OPERATOR OF A SOLAR ENERGY
GENERATION FACILITY THAT IS NOT A TAX-EXEMPT ENTITY.
(E) "TAX-EXEMPT ENTITY" MEANS AN OWNER OR OPERATOR OF A SOLAR ENERGY
GENERATION FACILITY THAT IS LISTED UNDER SECTION 501(C) OF TITLE 26 OF
THE UNITED STATES CODE.
2. (A) THE AUTHORITY SHALL ENTER INTO AGREEMENTS TO PURCHASE ALL OF
THE ELECTRICITY GENERATED BY THE OWNER OR OPERATOR OF A SOLAR ENERGY
GENERATION FACILITY LOCATED WITHIN THE SERVICE AREA OF THE AUTHORITY AT
THE PRICES SET FORTH IN SUBDIVISION SIX OF THIS SECTION USING THE
CONTRACT DEVELOPED BY THE AUTHORITY PURSUANT TO SUBDIVISION THREE OF
THIS SECTION ON A FIRST-COME-FIRST-SERVED BASIS. CONTRACTS ENTERED INTO
PURSUANT TO THIS SUBDIVISION SHALL BE TRANSFERABLE AND MAY BE USED AS
SECURITY FOR LOANS. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRA-
RY, THERE SHALL BE NO CAP ON THE AMOUNT OF ELECTRICITY PURCHASED FROM AN
INDIVIDUAL OWNER OR OPERATOR OF A SOLAR ENERGY GENERATING FACILITY
LOCATED WITHIN THE SERVICE AREA OF THE AUTHORITY PURSUANT TO THIS
SECTION. THE ONLY LIMITATION ON THE AMOUNT OF ELECTRICITY PURCHASED

S. 3057 3 A. 3885

PURSUANT TO THIS SECTION SHALL BE THE AGGREGATE LIMITATION PROVIDED FOR
IN PARAGRAPH (C) OF SUBDIVISION THREE OF THIS SECTION.
(B) THE OWNER OR OPERATOR OF A SOLAR ENERGY GENERATION FACILITY SHALL
PROVIDE THE AUTHORITY WITH NOTICE NOT LESS THAN SIXTY DAYS PRIOR TO THE
SOLAR ENERGY GENERATION FACILITY BECOMING OPERATIONAL. ONCE OPERATIONAL,
THE OWNER OR OPERATOR OF THE FACILITY SHALL REQUEST INTERCONNECTION WITH
THE ELECTRICAL CORPORATION'S DISTRIBUTION SYSTEM.
(C) (I) THE AUTHORITY SHALL CONNECT A SOLAR ENERGY GENERATION FACILITY
TO ITS DISTRIBUTION SYSTEM UPON THE TERMS AND CONDITIONS SET BY THE
AUTHORITY, BUT IN NO CASE MORE THAN SIXTY DAYS AFTER THE REQUEST FOR
INTERCONNECTION PURSUANT TO PARAGRAPH (B) OF THIS SUBDIVISION. THE
AUTHORITY SHALL APPLY, IN A NONDISCRIMINATORY MANNER, ESTABLISHED STAND-
ARDS FOR THE INTERCONNECTION OF SOLAR ENERGY GENERATION FACILITIES THAT
WILL ENSURE THE RELIABILITY OF ELECTRICAL SERVICE TO ALL CUSTOMERS, AND
WILL ENSURE THE SAFETY OF CUSTOMERS, GRID OPERATOR EMPLOYEES, AND THE
GENERAL PUBLIC.
(II) THE AUTHORITY SHALL PREPARE, PUBLISH, AND APPLY TRANSPARENT,
OBJECTIVE, AND NONDISCRIMINATORY RULES FOR CONNECTING SOLAR ENERGY
GENERATION FACILITIES TO ITS DISTRIBUTION SYSTEM.
(III) IF THE AUTHORITY DOES NOT PROVIDE INTERCONNECTION WITHIN THE
SIXTY-DAY TIMEFRAME ESTABLISHED PURSUANT TO SUBPARAGRAPH (I) OF THIS
PARAGRAPH, THE AUTHORITY SHALL BEGIN PAYMENTS PURSUANT TO PARAGRAPH (A)
OF THIS SUBDIVISION ON THE SIXTY-FIRST DAY AND THEREAFTER. THE PAYMENT
AMOUNTS SHALL BE BASED ON THE NAMEPLATE CAPACITY THAT THE SOLAR ENERGY
GENERATION FACILITY COULD PROVIDE IF CONNECTED TO THE DISTRIBUTION
SYSTEM.
(IV) ALL COSTS ASSOCIATED WITH THE INTERCONNECTION OF SOLAR ENERGY
GENERATION FACILITIES, INCLUDING DIRECT INTERCONNECTION COSTS, DISTRIB-
UTION SYSTEM ENHANCEMENTS, AND AUTHORITY COMPLIANCE COSTS, SHALL BE PAID
BY THE AUTHORITY AND INCLUDED AMONG THE COSTS THAT THE AUTHORITY SHALL
CONSIDER UNDER PARAGRAPH (C) OF SUBDIVISION THREE OF THIS SECTION FOR
COST RECOVERY FROM RATEPAYERS.
3. (A) THE AUTHORITY SHALL DEVELOP A STANDARD CONTRACT OF TWENTY YEARS
DURATION TO BE USED FOR ALL PAYMENTS MADE PURSUANT TO SUBDIVISION TWO OF
THIS SECTION. THE CONTRACT SHALL BE WRITTEN IN SIMPLE, CLEAR LANGUAGE
AND SHALL SPECIFY BOTH OF THE FOLLOWING:
(I) THE PRICE TO BE PAID FOR EACH KILOWATT-HOUR GENERATED.
(II) THAT THE OWNER OR OPERATOR OF THE SOLAR ENERGY GENERATION FACILI-
TY MUST SELL, AND THE ELECTRICAL CORPORATION MUST PURCHASE, ALL OF THE
SOLAR ENERGY GENERATED BY THE SOLAR ENERGY GENERATION FACILITY.
(B) THE AUTHORITY MAY ADJUST THE AMOUNT SET FORTH IN SUBDIVISION SIX
OF THIS SECTION NO MORE THAN ONCE EVERY TWO YEARS. THE AUTHORITY SHALL
ANNUALLY REVIEW THE AMOUNT TAKING INTO CONSIDERATION THE ABILITY OF SUCH
AMOUNT TO SUCCESSFULLY ENCOURAGE THE INSTALLATION OF SOLAR ENERGY GENER-
ATION FACILITIES AND TAKING INTO CONSIDERATION ANY CHANGES IN ANY OF THE
FOLLOWING:
(I) ACTUAL AVERAGE SYSTEM COSTS AND THE PRODUCTION OF EACH TYPE AND
SIZE OF SOLAR ENERGY GENERATION FACILITY.
(II) INFLATION AND INTEREST RATES.
(III) THE RETURN ACHIEVED BY THE OWNERS OR OPERATORS OF THE SOLAR
ENERGY GENERATION FACILITIES AND THE ELECTRICITY RATES PAID BY RATEPAY-
ERS.
(C) NO MORE THAN ONE HUNDRED MEGAWATTS OF ALTERNATING CURRENT RATED
PEAK ELECTRICITY IS SUBJECT TO THE REQUIREMENTS OF THIS SECTION.
4. THE AUTHORITY SHALL ENSURE ALL OF THE FOLLOWING:

S. 3057 4 A. 3885

(A) A SIMPLE, CLEAR APPLICATION FORM FOR SOLAR ENERGY SYSTEM OPERATORS
OR OWNERS REQUIRING IDENTIFICATION OF THE SOLAR ENERGY GENERATION FACIL-
ITY OWNER AND THE INSTALLER, AND THE PRECISE LOCATION, TYPE AND SIZE OF
THE FACILITY.
(B) APPLICATIONS ARE PROCESSED IN LESS THAN THIRTY DAYS.
(C) SOLAR ENERGY GENERATION FACILITIES ARE COMMISSIONED WITHIN ONE
YEAR AFTER THEIR APPLICATION IS APPROVED.
(D) NO SYSTEM INSPECTION IS REQUIRED BEYOND WHAT IS REQUIRED BY EXIST-
ING LAW.
(E) THE INSTALLATION AND USE OF A SEPARATE, DEDICATED METER TO MEASURE
THE PRODUCTION OF SOLAR ENERGY FACILITIES OPERATING PURSUANT TO THIS
SECTION, AND REQUIRING ELECTRICAL CORPORATIONS TO READ THAT METER AT NO
COST TO THE OWNER OR OPERATOR OF THE SOLAR ENERGY GENERATION FACILITY.
5. (A) THE AUTHORITY SHALL PREPARE AN ANNUAL REPORT DESCRIBING AND
SUMMARIZING THE PROGRAM PURSUANT TO THIS SECTION.
(B) THE AUTHORITY SHALL BIENNIALLY SUBMIT A REPORT TO THE LEGISLATURE
AND THE GOVERNOR ON THE IMPLEMENTATION OF THIS SECTION THAT SHALL
INCLUDE, BUT NOT BE LIMITED TO, ALL OF THE FOLLOWING:
(I) THE GENERATION CAPACITY OF NEW SOLAR ENERGY GENERATION FACILITIES
INSTALLED IN THE SERVICE AREA OF THE AUTHORITY AND THE ENVIRONMENTAL
EFFECTS OF THE ADDITION OF SUCH FACILITIES.
(II) ACTIONS TAKEN BY THE AUTHORITY TO IMPLEMENT THIS SECTION.
(III) REVISIONS TO THE AMOUNT SET FORTH IN SUBDIVISION SIX OF THIS
SECTION.
(IV) THE IMPACT OF THE IMPLEMENTATION OF THIS SECTION ON ELECTRICAL
RATES.
(V) RECOMMENDATIONS FOR CHANGES TO THIS SECTION, IF ANY, THAT MAY BE
NECESSARY OR ADVISABLE, INCLUDING WHETHER THE PROVISIONS OF THIS SECTION
SHOULD BE EXPANDED TO OTHER CITIES OR ADOPTED STATEWIDE.
6. THE PRICE OF ELECTRICITY UNDER AN AGREEMENT ENTERED INTO PURSUANT
TO THIS SECTION SHALL BE $0.22 PER KILOWATT HOUR.
S 3. Severability. If any clause, sentence, paragraph, section or part
of this act shall be adjudged by any court of competent jurisdiction to
be invalid and after exhaustion of all further judicial review, the
judgment shall not affect, impair or invalidate the remainder thereof,
but shall be confined in its operation to the clause, sentence, para-
graph, section or part of this act directly involved in the controversy
in which the judgment shall have been rendered.
S 4. This act shall take effect on the first of January next succeed-
ing the date on which it shall have become a law.

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